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Redundancy Selection Process.

At Resolve HR we have previously highlighted that in any unfair dismissal claims relating to redundancy situations, the onus is on employers to clearly demonstrate:

The existence of a genuine Redundancy situation.

That the employee was consulted and alternative options were examined i.e. Short Time, Alternative Positions.

That they used transparent procedures and criteria in selecting employees for redundancy and that these criteria were used in a fair manner e.g. LIFO, Matrix selection process

Traditionally claims relating to unfair selection for redundancy were brought under the Unfair Dismissals Acts. However with the advent of the Equality Acts and the Equality Tribunals tendency towards large monetary awards (as a form of sanction on employers) a new route for claims is emerging.

The following briefly outlines the outcome of a recent Labour Court appeal concerning a pregnant employee who was made redundant by her employer. The employer argued that the redundancy was carried out using an objective matrix selection process. The employee claimed that her selection for redundancy was actually motivated by her pregnancy.

Instead of bringing an unfair dismissal claim on the basis of unfair selection under the Unfair Dismissals Acts, she brought a complaint under employment equality legislation to the Equality Tribunal, alleging that her dismissal had been discriminatory on grounds of gender and family status. An Equality Officer found in her favour and made an award of €30,000 in compensation, the employer appealed this finding to the Labour Court who's decision is summarised as follows:

The Court declared that European case law (namely the Dekker, Webb and Brown cases) provided that special protection against dismissal exists during pregnancy at work and that the dismissal of a pregnant employee raises a prima facie case of discrimination on the gender ground. The onus of proof is therefore clearly on the employer to show that there were exceptional circumstances justifying the selection of the complainant for redundancy. Turning to the redundancy matrix, it concluded that it was unsatisfactory being complex, opaque, subjective and most critically, open to manipulation in order to achieve a particular result. The fact that it was completed by the Finance Manager rather than the complainant's Line Manager (as the employers procedures demanded) was also significant, given his evidence in relation to her perceived lack of flexibility on family grounds. Combined with her existing well-advanced pregnancy, it was clear to the Court that the respondent had failed to discharge the onus upon it. Finally, the Court noted that the complainant did not exercise her right of appeal and expressed its view that she should have done so. It concluded that a discriminatory dismissal on grounds of gender and family status had taken place. However, the award of €30,000 in compensation made by the Equality Officer was reduced by the Court to €20,000. Although it is not stated in the decision, the reduction may be linked to the complainant's failure to exercise her right of appeal.(ADE/08/22, Determination No.EDA095, March 27th, 2009).

This decision raises a number of issues for employers:

The Unfair Dismissals Acts are not the only external avenue of appeal open to staff who have been made Redundant. The Equality Acts provide an alternative and often more rewarding avenue for an employee.

When an employer has a procedure in place, any failure to follow that procedure will fatally damage the employer's case in any hearing. This point cannot be emphasised enough and consistently emerges time after time at Third Party hearings.

While Matrix selection procedures have been promoted by many Employment Law specialists as a sound redundancy selection process, they must still be demonstrate ably fair and easily understood by employees.